Why powerful people are rarely punished appropriately

Justine Sacco, Lindsey Stone, and Alicia Ann Lynch all lost their jobs and suffered tremendous emotional distress from the vitriol unleashed in the social media world on each of them. Their “crime”: some tasteless posts on Twitter or Facebook.

Powerful executives and public figures often face surprisingly few consequences from actions that can cost companies billions of dollars and thousands of employees their jobs. One study of directors found that people who had served on the boards of banks that required government assistance during the financial crisis confronted turnover imperceptibly higher than peers who had served on banks that had weathered the financial storm in better shape. New York Times columnist Andrew Ross Sorkin detailed the many directors who maintained their positions even after presiding over financial disasters—Stan O’Neal, former CEO of Merrill Lynch who was on the board of Alcoa; Charles Prince of Citigroup, who was on the boards of Xerox and Johnson and Johnson; and James Johnson, the former chief executive of troubled mortgage giant Fannie Mae, who remained on the boards of Target and Goldman Sachs.

How can we make sense of the imbalance between the severity of the punishment people face, or the lack thereof, and the damage those individuals caused or at least oversaw?

These facts make organizational self-regulation inherently problematic. Stanford enforces its standards through a board of judicial affairs that consists of 15 people drawn from faculty, staff, and students, an arrangement typical across universities. Boards of directors share social ties and experiences, and are likely to see board members even from other companies as somewhat similar. Expecting harsh punishment and sanctions from others who share social identities and affiliations flies in the face of what we know about interpersonal behavior—and unsurprisingly, harsh sanctions are rare in these cases.

We also know that people like to “bask in reflected glory,” to identify and be associated with winners, with the powerful, with rich and successful people or organizations. Consequently, we are more likely to make excuses for the powerful, or at least excuse our continued association with them, almost regardless of their behavior. When Dominique Strauss-Kahn appeared before the French parliament, one senator said, “His intellectual qualities are not at stake. We lack very good specialists on banks and tax evasion on the international level.” Almost inevitably, standards and sanctions differ depending on the power of the accused.

Fairly enforcing norms and standards

So, how do we develop processes that ensure that sanctions are more aligned with the severity of the harm someone inflicts?

First, we might try something that few people seem to do these days—ask how much harm a particular action has caused. If the behavior is tasteless but largely harmless, then instead of mounting some social media screed, leave the person alone. Unfocused, misdirected, and disproportionate anger isn’t good for anyone.

Second, because people are unlikely to take stern action against those who are like them, we should turn to outsiders who possess objectivity and don’t have social ties or similarity to the people accused. In the American judicial system, people are judged by juries of their peers, not juries of their friends or others who share social identities, such as employers, with them—and for good reason. The lack of quasi-judicial proceedings involving independent judges on college campuses and in corporate boardrooms makes it much harder to properly mete out punishments.

Third, because we know that there is a bias that favors the powerful, producing justice requires measures to redress this predisposition. One step might be to acknowledge and remind observers of the psychological factors that favor the powerful as a means to inoculate against this tendency. Another step would be to, in more formal proceedings, limit the powerful individuals’ display of the accoutrements of their power.

A fourth solution derives from the well-known Gyges effect, the “disinhibition created by communications over the distances of the Internet,” of having people being able to comment on and make judgments of others anonymously. When people are accountable for their judgments and actions, they are more likely to behave responsibly. I have advocated that academic journal reviewers be identified and identifiable after the fact for precisely this reason. We need and deserve to know who sits in judgment.

None of these solutions is a panacea. But the disproportionate responses—both too much and too little punishment for infractions large and small—suggest we need to pay much more attention to this issue.

Jeffrey Pfeffer is Thomas D. Dee II Professor of Organizational Behavior at Stanford’s Graduate School of Business. His latest book, Leadership B.S.: Fixing Workplaces and Careers One Truth at a Time, will be published in September 2015 by HarperCollins.

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